Month: February 2013

Casualty Rates Expected to Rise, per Property & Casualty 360

Chris

A recent article in the February 2013 issue of Property Casualty 360 magazine outlined projections for casualty rates for the remainder of 2013.  For those that are unaware, casualty insurance is often equated to liability insurance but is insurance not directly concerned with life, health, or property insurance.  Casualty rates climbed during the fourth quarter of 2012 and shockingly, are expected to increase during 2013.

A recent report from the brokerage, Marsh, focused on four U.S. Casualty lines of business:  General Liability, Workers’ Compensation, Auto Liability, and Umbrella/Excess Casualty.

Umbrella/Excess:

  • 56% of clients experienced increase in rates
  • 29% experienced no change in rates
  • Average increase in rate was 4.9%

General Liability:

  • 54% of clients experienced increase in rates
  • 18% experience no change in rates
  • Average rate increase was 2.1%
  • Clients with superior loss history, good loss control measures, and lower exposures were able to secure rate decreases at renewal.
  • Underwriting scrutiny continued to increase = longer processing times

Workers’ Compensation:

  • 51% of clients experienced rate increases
  • 16% experience no change in rates
  • Average rate increase was 2.9%
  • Marsh reports in its study that this line of business has been operating at a “historically unprofitable level for insurers”.  Insurers will look to become more profitable via rate increases and higher retentions
  • Employers with good loss control programs tend to be better protected from rate increases

Auto Liability:

  • Rates were stable throughout 2012; however, Q4 experienced the most clients that experienced rate increases at 47%
  • 24% experienced no change in rates
  • Insurers sought rate increases for this line; but typically agreed to on rates that were lower than the original quote

The insurance rates that have grabbed the headlines had been property rates – due to the increased weather activity, deductible requirements, and other underwriting changes by companies.  However, it’s important to note that casualty rates continue to rise – especially in workers’ compensation.  Additionally, it’s is of particular interest to note that most insurers are willing to write policies at a lower rate if the client agrees to implement loss control measures and has a favorable loss history.

It’s important to remember these studies when you are reviewing your renewal policies this coming year.  As always, if you have any questions, don’t hesitate to contact us!

Annual Insurance Policy Review – Five Practical Tips for a better policy

Chris

The most common reasons that a policyholder and insurance agent talk after a policy is put in force aren’t always for the most positive reasons.  The conversation generally revolves around bills, payments, pricing or claims.  The conversation normally doesn’t revolve around information updates or coverage.

mental-strength-checklist

At American Advantage Insurance – we do our best to do an annual policy review with our policyholders to ensure that all critical information is updated and that coverage is still adequate and up to date.  However, we are human and some items do fall through the cracks.  Therefore, we encourage all policyholders – whether you are our client or not – to review their policy at least one time per year.  This ensures that you are covered properly and that you are also getting the best pricing available to you.  In 2013 – where the world treats insurance as a commodity – pricing is as important to consumers as coverage is to agents.  Here are five quick tips for your annual policy review:

  1. Verify that name, address and contact information is correct.  This eliminates the most common problems and verifies that we can contact you should we need to.
  2. Check to see that all vehicles and drivers are accurate.  Did your child turn 16 and you forget to tell your agent?  Did you purchase or dispose of a vehicle?  Is your date of birth correct?  Did a child move out of the household or enroll in college?  These are critical factors for attaining the best rate and coverage possible.
  3. Verify home address and browse the coverage.  You’re not expected to know all the coverage included in your homeowners insurance policy (that’s why we are here); but it doesn’t hurt to make sure the company has at least the correct address on the policy and that coverage does not seem unusually high or low.  Don’t be afraid to ask questions about coverage – that’s our job to answer them.  Did you put an addition on your home and didn’t tell us?  Was your basement finished this past year?  Did you buy jewelry that needs to be scheduled?  These are the most common items that need to be addressed.
  4. Verify that all ‘toys’ are insured.  Snowmobiles, ATV’s, motorcycles, boats, and bikes are all common in the state of Wisconsin.  Each company covers these items in different ways – both from a liability and physical damage perspective.  Be sure that these items are on your policy and that they are insured properly.
  5. Inform your agent of any updates to your home.  Did you install a new roof or new furnace?  Did you install deadbolt locks or an alarm system?  These are common items that policyholder’s fail to relay to their agents.  In failing to do so, you may be costing yourself some money.  Many companies have a discount for many home updates.

These are five quick and easy tips to ensure that your coverage and pricing is up to date.  This process should not take more than 10 minutes and is well worth your while.  Should you have any questions regarding your policy coverage or pricing, don’t hesitate to contact us – we’re happy to help.